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A perfectly competitive firm's supply curve is that portion of its marginal cost curve that lies above the minimum of the average variable cost curve.
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∙ 15y ago
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Is the price elasticity of supply usually larger in the short run or in the long run?
long run is ever smaller than short run
In normal cirucmstances is there a short run tradeoff between the rate of inflation and the rate of unemployment?
Yes. Inflation causes businesses to have to cut costs, and labor is one of the easily cuttable costs. See the Phillips Curve.
In short run does demand pull raise both the price level and the real output?
No, it only raises the price level. Output cannot adjust quick enough in the "short run". That's why it's called the short run.
What is a Home Run in an Elevator shaft?
high short pop up
What is the top speed a cheetah can reach?
A cheetah can run at 70mph but only for short distances, they usually run at 40-50 mph.
What is the lowest point on a firms short run supply curve?
The minimum is price=average cost below this price supply=0
A horizontal short-run aggregate supply SRAS curve implies that in the short run?
In the short run, prices are fixed and firms produces output to meet demands. So, firms take prices as given and produce output to meet desired expenditure.
The short term aggregate supply curve represents the relationship between what?
The short term aggregate supply curve represents the relationship between the price level and the quantity of real GDP that firms are willing to supply in the economy. It shows the level of output that firms can produce in the short run at different price levels.
Why is it that short run aggregate supply curve is normal?
Because the supply curve basically is for the short run, and not permanent for the long run. That's why it's considered normal.
Is The supply curve more or less elastic in the long run than the short run?
more
A firm's marginal cost curve above the average variable cost curve is also?
A firm's short run supply curve
What is the shape of supply curve during the market period?
The supply curve during the market period is perfectly inelastic and vertical. This shows that the supply cannot be increased in the short run.
Why is the short run supply curve positively sloped?
The short run supply curve is positively sloped because it has positive outputs.The profits are high and maximised.Short run decision for a firm is the quickiest and the most risky way to maximise profits in the short period of time.In the short run decision profits are usually reached which means that the firm didn't loose so the curve must be positively sloped as the firm is not in minus. hope I helped.....
What is the meaning of the intersection of three curves the AD curve and the short run AS curve and the long run AS curve?
Using the AD-AS model, start with a long-run equilibrium and assume velocity V is constant, then analyze the following case: The pandemic recession is the result of adverse Demand and Supply shocks. a. What happens to the Aggregate Demand curve and What happens to the Aggregate Supply curve? b. What happens to output Y and the price level P in the short run? c. What short-run problems are created for the labor and goods markets? d. What kinds of stabilization policies are required to stimulate recovery? Describe the 5 specific tools and their directions of change to be used.
Why does the slope of the aggregate supply curve change from the short run to the long run?
Aggregate supply is a measure of the total goods and services produced by an economy at various price levels, either in the short run or in the long run. Short run aggregate supply curve is assumed to be upward sloping. Higher prices for goods and services means more profit for suppliers, so they will produce more goods and services. Long run aggregate supply curve is assumed to be vertical. Short run aggregate supply curve is curved because prices can change. A change in the price level means a movement along the short run aggregate supply curve. An increase in costs results in a fall in aggregate supply because the output is less at every price level. A decrease in costs results in a rise in aggregate supply because the output is more at every price level. In the long run, the aggregate supply is assumed to be independent of price level. In other words, the economy is at the maximum output possible. Full employment level has been reached and real GDP has reached its maximum potential, so the long run aggregate supply curve must be drawn as vertical. Increases in the quality and number of factors of production will cause the productivity of the suppliers to increase, and the long run aggregate supply will shift right.
What is the relationship between long-run average cost curve and short-run average cost curve?
what is the relationship between long run average cost curve and short run average cost curve?
What determines the quantity of a good that seller suply?
It's good to start with a definition of supply. Supply is the willingness and ability of a firm to supply a good (or service). Ultimately what determines the amount a firm supplies is the market price of the good. Most supply curves are upward sloping to the right (in other words a positive gradient) meaning that as price increases, supply extends. This is because as the price of the good goes up, the more willing and able a firm will be to produce a good. The supply curve is the firms marginal cost curve above above the average variable cost curve. This is because in the short run firms only need to cover their variable costs. Below this firms cannot survive and thus will not operate (this is known as the shut down condition). Ultimately the quantity of a good supplied is determined by the price. Hope that helps. Talha Emir Kaplan
